Selling a house in Bergen County NJ is a full time job which requires a full time Realtor. When a home owner assumes the position of a Realtor when selling home by owner is asking for trouble.

As your Bergen County Real Estate Expert, I offer free comparative market analysis. Home owners don't have access to this critical information when selling home by owner. The goal is to protect your equity.

There are several tasks a home owner has to undertake when selling home by owner. Having a real estate education, finding a homebuyer who's pre approved for mortgage is a small part of the process. Scheduling showings when you sell your own home and opening your doors to homebuyers can potentially lead to theft.

Once a buyer is willing, ready and able to purchase a home from a FSBO, a contract must be executed. The contract Realtors use is The Statewide New Jersey Realtors Standard Form Of Real Estate Sales Contract.

Collecting the earnest money deposit and placing it in the sellers attorney's escrow account is next.

We move on to attorney review which can extend itself well beyond the three day attorney review period. A buyer can back out at anytime during the attorney review period and the home inspection clause.

If the home buyer can't secure a mortgage loan the deal will fall apart. Let's say the home buyer obtains a mortgage commitment the next process is to confirm they secured home insurance.

Hiring a title insurance company to clear title, getting the Certificate of Occupancy and collecting deposits will lead to closing.

A for sale by owner will go through great lengths to save on the real estate commission. Some home sellers wonder how they can list house on MLS (Multiple Listing Service). Listing with MLS has to be done with a licensed Realtor.

After some research online they encounter Realtors who offer a MLS flat fee listing to advertise their home. Some Realtors will charge a for sale by owner as little as $99.00. Imagine the diluted service a for sale by owner will receive when they subscribe to that. I recall the old adage, "you get what you pay for." A flat fee MLS listing may cost the for sale by owner thousands of dollars.

Contracting a Bergen County Real Estate Expert like myself, gives a FSBO a chance to actually sell their home.

A study by Collateral Analytics reveals that FSBOs don’t actually save anything. In some cases they may be costing themselves more by not listing with an agent.

In the study, they analyzed home sales in a variety of markets. The data showed that:

“FSBOs tend to sell for lower prices than comparable home sales, and in many cases below the average differential represented by the prevailing commission rate.” (emphasis added)

Selling Your Home On Your Own Could Cost You

Why would FSBOs net less money than if they had used an agent?

The study makes several suggestions:

“There could be systematic bias on the buyer side as well. FSBO sales might attract more strategic buyers than MLS sales, particularly buyers who rationalize lower-priced bids with the logic that the seller is “saving” a traditional commission. Such buyers might specifically search for and target sellers who are not getting representational assistance from agents.” In other words, ‘bargain lookers’ might shop FSBOs more often.

“Experienced agents are experts at ‘staging’ homes for sale” which could bring more money for the home.

“Properties listed with a broker that is a member of the local MLS will be listed online with all other participating broker websites, marketing the home to a much larger buyer population. And those MLS properties generally offer compensation to agents who represent buyers, incentivizing them to show and sell the property and again potentially enlarging the buyer pool.” If more buyers see a home, the greater the chances are that there could be a bidding war for the property.

Conclusions from the study:

FSBOs achieve prices significantly lower than those from similar properties sold by Realtors using the MLS.

The data suggests the average price was near 6% lowerfor FSBO sales of similar properties.

Bottom Line

“Research has shown that, between mistakes, lack of negotiating skills, pricing errors and general exposure on the market, you’ll cost yourself more than the real estate commission…You’ll come out slightly better and with a lot less hassle if you use a top-shelf agent.”

Sell your house. Don’t wait! Recently released data from the National Association of Realtors (NAR) suggests that a now is a great time to sell your home. The concept of ‘supply & demand’ reveals that the best price for an item is realized when the supply of that item is low and the demand for that item is high.

Let’s see how this applies to the current residential real estate market.

SUPPLY

Supply of homes for sale has been far below the number needed to sustain a normal market for over a year. A normal market requires six months of housing inventory to meet the demand. The latest report from NAR revealed that there is currently only a 3.6-month supply of houses on the market.

Supply is currently very low!

DEMAND

A report that was just released tells us that demand is very strong. The most recent Foot Traffic Report (which sheds light on the number of buyers who are actually out looking at homes) disclosed that “foot traffic grew 10.5 points to 52.4 in March as the new season approaches.”

Is Your First Home Within Your Grasp Now? For the longest time, many experts doubted whether Millenials (age 18-36) valued homeownership as part of the American Dream. Looking at the latest statistics from the National Association of Realtors we can see that ‘Old Millenials’ (ages 25-36) are dominating the first-time homebuyer category.

Some Highlights:

According to the US Census Bureau, ‘millennials’ are defined as 18-36-year-olds.

“America’s housing market is gearing up for a robust year ahead. Builders are more optimistic, demand is strong and lean inventory is keeping prices elevated.”

And the National Association of Realtorsrevealed that buyer traffic is stronger this winter than it was during the spring buying season last year.

The only challenge to the market is a severe lack of inventory. A balanced market would have a full six-month supply of homes for sale. Currently, there is less than a four-month supply of inventory. This represents a decrease in supply of 9.7% from the same time last year.